Richard Pieris records Rs. 8.2b turnover in Q1
The Richard Pieris Group recorded a turnover of Rs. 8.2 billion
during the quarter ended June 30, 2013 with a Profit Before Tax of Rs.
330 million. The reported profit for the year does not include any gains
of a capital nature.
The retail sector had a robust performance during the first quarter
with many marketing campaigns. The launch of 'Buy what you want and not
what you get' campaign created a lot of excitement in the market.
The sector commenced commercial operations in three of its showrooms
in Nittambuwa, Wellawaya and Galewela. The negative sentiments on
consumer confidence continued to be evident throughout the quarter under
review. The implementation of VAT from January 1, 2013 affected the
performance of the sector in the quarter under review as well.
Therefore, the company continued to focus on managing overheads and
inventory.
The plastics and distribution sector faced a range of challenges
during the quarter ended June 30, 2013, which included unfavourable
market conditions, a sharp slowdown in the construction industry due to
bad weather, low purchasing power of consumers and adverse economic
conditions.
The sector introduced a second brand of mattresses to compete in the
lower end of the market and suit present market conditions while
carrying out aggressive dealer promotions.
The sector also implemented several new distribution strategies to
expand market penetration and to capitalise on synergies.
The plantation sector faced a setback in profitability arising from
the wage increase and the demand for rubber continued to stagnate in the
world market due to the poor economic climate in Europe. Adverse weather
also affected the sector performance with a drop in tea, rubber, coconut
and oil palm crops when compared with the previous year.
Various cost improvement initiatives were initiated to maintain the
profitability of the sector.
The tyre sector changed its energy sources by introducing firewood
boilers in a positive response towards addressing high energy costs.
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